Oil prices stabilized on Friday after rebounding in the previous session due to some bargain hunting, but were still poised for substantial weekly losses amid persistent concerns over weakening demand.Â
Ongoing negotiations over a ceasefire between Israel and Hamas also saw traders assign a smaller risk premium to crude, as U.S. officials indicated that an agreement was close.
Oil markets were rattled by data showing a sharp downward revision in U.S. payrolls, which heightened concerns over a potential economic downturn. However, they rebounded from recent losses on Thursday as data revealed a sustained drawdown in U.S. crude inventories.
Brent oil futures expiring in October edged up 0.1 percent to $77.26 per barrel, while West Texas Intermediate crude futures rose 0.1 percent to $72.34 per barrel by 21:06 ET (01:06 GMT).
Read more: Oil prices weaken on U.S. labor data, demand outlook uncertain
Oil on track for weekly losses amid demand worries
Both benchmark contracts were poised to lose over 4 percent each this week, having recorded steep declines on concerns that a U.S. recession could undermine demand.
The losses in crude came even as traders saw an increased likelihood of an interest rate cut by the Federal Reserve in September, which weighed on the dollar. However, the greenback rebounded on Thursday.
While U.S. demand appeared robust in the near term, as reflected in government data showing a significant drawdown in inventories, traders feared that worsening economic conditions could stifle demand in the coming months.
Concerns about an oil supply glut were also in play, after U.S. oil production rose to a record high of over 13 million barrels per day earlier in August.
Nevertheless, the recent weakness in prices could prompt the Organization of the Petroleum Exporting Countries and its allies (OPEC+) to scale back some of their plans to raise output later this year.
The cartel had recently trimmed its outlook for global oil demand, citing concerns over weak demand in top oil importer China.
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